“Former Coinbase CTO and General Partner of Andreessen Horowitz Balaji Srinivasan criticized the meme coin segment amid the hype surrounding TRUMP and MELANIA. A memecoin is a zero-sum* lottery. There is no wealth creation. Every buy order is simply matched by a sell order. And after an initial spike, the price eventually crashes and the last buyers lose everything. […]”, — write: businessua.com.ua
Former CTO Coinbase and Andreessen Horowitz General Partner Balaji Srinivasan criticized the memecoin segment amid the hype surrounding TRUMP and MELANIA.
A memecoin is a zero-sum* lottery.
There is no wealth creation. Every buy order is simply matched by a sell order. And after an initial spike, the price eventually crashes and the last buyers lose everything.
* It’s actually a negative sum if the platform takes a cut.
— Balaji (@balajis) January 19, 2025
The entrepreneur called such assets a “negative sum lottery,” where participants trade with each other and platforms take commissions. He compared buying memecoins to entertainment like gambling and noted that they should be approached accordingly.
“[У мем-коїнах] no value is created. Each buy order is simply followed by a sell order. After the initial jump, the price eventually falls and the last buyers lose everything,” explained Srinivasan.
In his opinion, a wide range of crypto investors should pay attention to assets that retain value in the long term.
Bernstein analysts, on the other hand, noted the launch of the “presidential” memecoin as a sign of the beginning of a more favorable period for cryptocurrencies around the world.
“This marks a new era of regulation in which governments see cryptocurrency as a technology to reach the masses directly. This may lead some politicians to be friendly towards digital assets,” the firm said.
Bernstein also highlighted the benefits for US developers who may not be afraid to launch their own tokens in a previously troubled jurisdiction:
“Given that the previous US regulatory regime was notably repressive [творців криптозастосунків] and token enforcement, the president’s launch of his own asset is a significant social signal for American developers.”
It will be recalled that in January, activist Ryan Fournier faced criticism from the community for selling half of the stock of meme coin dedicated to unblocking TikTok in the United States.
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